Article

Have A Game Plan - Stick With It

August 2006, Auto Dealer Today - WebXclusive

by Harlene Doane - Also by this author

Want to double your special finance growth in just under a year? What does it require? Ask Scott Boggess of Paul Miller Ford in Lexington, Kentucky and he will tell you several things. “The most important item is creating a game plan and sticking to it. Most processes fail when those involved aren’t committed to seeing it done correctly. We have been very fortunate to have a staff that understands that.”

Greg Wells is the e-commerce manager at Paul Miller Ford. “One of the most important things we have done is let Greg lead the way in our Customer Assistance Center,” stated Boggess. Wells oversees a staff of 14 in their BDC/CRM department that they call their Customer Assistance Center (CAC). It is the point of entry for all customer contact.

“Our Customer Assistance Center is designed around the Ford BDC system and we are in phase 2 of a 3 phase system. This means we have integrated our internet leads, phone ups, retail trade cycle, showroom, prospecting and first service appointments at this point. The next phase will bring us full circle to include all aspects of the service cycle,” stated Wells.

One of the first lessons learned by Paul Miller Ford was that they needed to remove all sales personnel from the CAC. “There is no temptation to sell while setting an appointment if there are no sales personnel in the CAC. We saw an immediate increase in our appointment setting rate of 4-5 percent when we removed the sales staff from our CAC,” said Wells.

When an appointment is set in the CAC, bells start ringing. It’s a fun place to be. Every appointment is sent a VIP postcard with the appointment date and time on it. Customers receive a call from a manager and the customers name is put on the VIP board in the showroom on the day that they are to arrive. Upon arrival the customer is greeting by a manager before a sales person starts their process. “This process allows the customer to know just how important they are to us from the beginning,” claims Boggess.

For those of you who are scratching your head trying to figure out how to get the postcard to the customer before their appointment when you have been trained to get them to the dealership today, here’s a novel idea--don’t worry about setting appointments for today. Today’s appointments were set yesterday and the days before. Occasionally, the postcard arrives to the customer after the appointment date; it serves as a reminder to customers that miss their appointments. Now Boggess and Wells know that it goes against everything being taught, but it is their belief that there is really no need to push the customer. “It’s all about the relationship you establish and customers appreciate the fact that you aren’t pushing them and you value their time,” says Wells. There must be something to it, at least in Kentucky, because Paul Miller Ford was the #2 retailer of used vehicles in the state in 2004.

Measuring your performance is the only way to improve your performance? So what is important to measure in a BDC? At Paul Miller Ford there are three key areas of measurement.

#1 Appointments set rate - This Customer Assistance Center sets appointments for 50 percent of their non-internet leads and 35 percent of their internet leads.

#2 Show rates – On average show rates are 50-60 percent in any given month.

#3 Closing rates of those that show - Closing rates average just over 70 percent for appointments that show. Wells keeps very detailed records, because of that he can tell you that the closing ratio for internet leads is almost 10 percent higher than any other lead source.

What does all of this mean to the dealership? “Our department has tracked it to the bottom line. For every appointment we set between $400 and $500 is added to gross profit,” proclaimed Wells.

You can’t help but get excited when Wells talks about his dedicated team of 14. “We have next to no turnover. Our team is paid hourly as well as receiving bonuses for appointments that show and appointments that sell. They work four 10 hour days a week and we have tons of fun.” Wells can get pretty creative when it comes to motivating non selling personnel. Lottery tickets and junk food are the two favorites among this team. “We even have a give-away when someone obtains an e-mail, full name or phone number during a live chat (which is on the internet not on the phone). So often the person in the chat doesn’t want to give out their identity so it’s a big deal when we get it.”

So where did he find all of these great employees? Amazingly, a large percentage of them through their own database of customers. They e-mail a great html piece regarding career opportunities at Paul Miller Ford to their customer database. Compare the cost of e-mailing this to your database against just running a single ad in your local Sunday paper and it makes perfect sense. You also reach a targeted group that already knows you. Some of their current employees were not customer themselves, but were referred by customers who received the career opportunities e-mail.

So who has benefited the most from the Customer Assistance Center at Paul Miller Ford? The Special Finance Department is the biggest benefactor thus far. CAC appointments make up about 30 percent of our Special Finance business. One year ago they were struggling to sell 35-40 units per month from their special finance department. Now this department, run by two special finance managers, Brian Clevenger and Gary Conlee, with the help of their staff of seven sales professionals and a funding administrator now process an average of 70 special finance deals per month.

The special finance department is actually housed in its own building, has its own inventory and ad budget. When inventory is purchased it is immediately taken to recon, then to detail and then photos are taken for their company website. The vehicle is tagged, by color coding the buyer’s guide, for the lot that it is destined for. The majority of the inventory on the special finance lot is in that sweet spot ACV value of $7,000-$11,000.

The majority of the advertising for special finance is e-mail based and is handled through the CAC. The dealership as a whole spends ad dollars on every type of media but is working hard at analyzing the effectiveness of each media type. Part of that process is utilizing Who’s Calling.

Joining a Leedom and Associates 20 group moderated by Greg Goebel about a year ago helped them establish some much needed structure and provided accountability. Accountability to answer to other dealers about their operation and being able to hear what they do caused Paul Miller Ford to improve as well.

Outside training for BDC practices are provided by Reynolds Consulting and keeps the CAC in order while Cherenk Consulting trains the F&I managers. What is menu selling, desking and sales training worth to the F&I department? Try 55 percent warranty penetration plus consistency in presentation.

Other than RCG and Chernek Consulting, all other training is done internally and religiously. Monday and Friday sales meetings are mandatory. Monday is training only and each department rotates training with Greg Wells usually overseeing that training. All sales staff, managers and all F&I personnel are required to attend. “Facing a room of 60 people ready for training will certainly keep each department on their toes and prepared. No one wants to be the one that isn’t ready,” states Boggess. Friday’s meetings are purely motivational; getting everyone excited for the weekend sales.

So what else is there left to do at this dealership? “Our webmaster is working hard to get our website to the level that we feel generates a sufficient number of leads. We are very focused on getting our site www.approvedcarloan.com to the next level, which will allow us to cut back on third party leads. It’s no secret that internet leads generated through your own site are more likely to sell,” said Boggess.

“We’ve come a long way in one year,” says Wells “in November of 2003, we had just 3,100 unique visitors per month. In November of 2004 we had 6400 unique visitors and they are spending more time on our site. We know a large part of that is due to our CAC and our follow-up.”

Another item on the horizon is to bring the Customer Assistance Center full circle to include all of the fixed operations of dealership. Based on what he has witnessed thus far, Lee Beall, fixed operations manager, can’t wait for that to happen. “We just expanded our body shop by 60,000 square feet and we have a stellar service department. An increase in our department similar to the rest of the dealership will be phenomenal and we can’t wait for it to happen.”

Be patient Lee, it’s in the game plan!

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